In a statement, Reserve Bank of India general manager Alpana Killawala said the press "mis-characterized" Rajan's remarks:

The Great Depression was a period of great turmoil, caused by many factors and not just beggar-thy-neighbour policies. Governor Rajan did not imply or suggest that there was any risk of the world economy, which is in steady recovery notwithstanding uncertainties like those in the Euro area, slipping into a new Great Depression.

According to local Indian media, Rajan warned at a London Business School conference that, in a global collective effort to "produce growth out of nowhere," we could be "shifting growth from each other, rather than creating growth."

"Of course, there is past history of this during the Great Depression when we got into competitive devaluation," he reportedly said.

The official script that Rajan was speaking from, released by the RBI, read: "I use Depression era terminology because I fear that in a world with weak aggregate demand, we may be engaged in a risky competition for a greater share of it. We are thereby also creating financial sector risks for when unconventional policies end."